THE Government would step up its fight against smuggling by increasing the maximum penalty to seven years' imprisonment, Secretary for Security Mr Alistair Asprey said yesterday. Control over the medium-powered speed boats, or chung fei, which are often used in smuggling will also be tightened under new, more stringent legislation. Amendments to the Import and Export Ordinance to make smuggling offences indictable and therefore subject to a higher penalty will be ready in the next few months and will be enacted before this legislative session ends. Speaking after yesterday's Fight Crime Committee meeting, Mr Asprey said car thefts had dropped significantly in the past few weeks. ''But . . . it is not something that we can relax our vigilance on,'' he said. ''The police would have to maintain that as a priority target. ''The presence in Hongkong of Chinese police liaison officers will help on all cross-border crime including car theft and smuggling.'' Mr Asprey said the Government would also impose controls on chung fei because some smugglers had tried to circumvent the restrictions already in place on the larger vessels - the tai fei - by using the smaller boats. ''We are trying to make sure that new legislation can cover those as well,'' he said. Mr Asprey said he hoped the recent breaking of the customs officers' smuggling ring would have an effect on the number of car thefts. ''I think it was a major syndicate and I certainly hope the action that has been taken and is continuing to be taken will have a major deterrent effect,'' he said. ''I hope that may well be one of the factors that has seen to the recent decline in the theft of luxury cars.'' The crime rate for the last quarter starting last November to January dropped by more than five per cent while that of violent crime decreased by more than six per cent compared with the previous year's statistics.